Here ya go!
Dear Fellow Employees,
We were recently notified by Delta Air Lines that they intend to terminate their agreement with Freedom Airlines with respect to our Delta Connection ERJ-145 flying. Delta’s intended contract termination does not affect Freedom’s CRJ-900 flying. As you can imagine, we are totally surprised and extremely disappointed by Delta's actions. We strongly believe they have not acted in accordance with the terms of our contract and I can assure you all that we intend to vigorously contest this patent violation of our contract.
In the meantime we will continue to operate all our Delta Connection flights as usual. I wish to stress that it is very important that we continue to maintain the focus on our operation and on serving Delta and its customers with the same professionalism you have always exhibited. Your contribution is greatly appreciated and very much valued by us all.
We understand that you will have questions and concerns and we will keep you posted as more information becomes available. A copy of the press release we issued a short time ago provides some additional information. Please take a moment and read it carefully. Freedom’s Chief Operating Officer, Joe Serratelli and his management team will be in the Freedom crew domiciles to meet with employees this afternoon and during the day tomorrow. In addition, as always please feel free to contact me directly.
This situation is of concern to all of us in the Mesa family but throughout our 25 year history we have faced a number of very challenging situations and we have always worked together to achieve a successful outcome. I am sure that with your support we will again work through this.
Sincerely
Jonathan Ornstein
Chairman & CEO Mesa Air Group
Mesa Challenges Delta’s Efforts to Terminate Contract
PHOENIX: April 1, - Mesa Air Group, Inc. (Nasdaq:MESA) (the “Company”) today announced that on March 28, 2008, Delta Air Lines, Inc. (“Delta”) notified the Company of its intent to terminate the Delta Connection Agreement among Delta, the Company, and Mesa’s wholly-owned subsidiary, Freedom Airlines, Inc. (“Freedom”), dated as of May 3, 2005 (as thereafter amended, the “Connection Agreement”). Delta seeks to terminate the Connection Agreement as a result of Freedom’s alleged failure to maintain a specified completion rate with respect to its ERJ-145 Delta Connection flights during three months of the six-month period September 2007 through February 2008. The notice issued by Delta is accompanied by a proposed temporary agreement pursuant to which Freedom would continue to provide Delta Connection services while the parties discuss the terms of a transition agreement. This termination does not affect Freedom’s CRJ-900 Delta Connection flying. Mesa vehemently denies there is any basis for terminating the Connection Agreement and intends to vigorously defend its rights thereunder.
The alleged failure to maintain the specified completion rate in the contract is due to Delta's own request of Mesa to remove flights to benefit Delta’s overall operation and/or to accommodate Delta mainline flights. These flights, among others, have always been taken out of Freedom’s performance calculations in the past and Delta acted consistent with this practice and has paid Mesa both its’ base margin and its’ incentive margin after crediting Mesa for the Delta mandated schedule changes and /or cancellations.
We appreciate Delta’s desire to reduce capacity as they publicly announced on March 18, 2008 but to do so unilaterally and in patent violation of their contract is not acceptable. There was no indication at any time from anyone at Delta that there was a potential issue and the notice comes as a total surprise to Mesa.
”We are confident that Delta’s actions are not supported by the terms of the Connection Agreement, that we have complied with all of our obligations under that agreement, and that Delta’s effort to terminate the agreement will not be upheld in a court of law.” said Mesa Air Group Chairman and CEO, Jonathan Ornstein.